The US Court of Appeals for the District of Columbia Circuit scrapped the Federal Energy Regulatory Commission (FERC)’s approval of Transcontinental Gas Pipeline Co.’s nearly $1 billion Regional Energy Access expansion project July 30, calling FERC’s decision “arbitrary and capricious” because it failed to adequately review the natural gas pipeline’s potential greenhouse gas (GHG) emissions.
A three-judge panel also questioned whether FERC properly considered the public interest of the pipeline that would boost Transco’s capacity by up to 829,000 Dt/d to serve about 3 million customers in five Mid-Atlantic states.
“We hold that FERC acted arbitrarily in granting the Certificate Order because it did not respond to some of the material challenges to its finding of market need for the project,” Circuit Judge J. Michelle Childs wrote.
The court found that FERC failed to explain why it “entirely discredited” the finding of two market studies that showed current capacity was adequate to meet New Jersey ratepayers’ natural gas demand beyond 2030.
It also failed to explain how president agreements with local distribution companies (LDCs) demonstrate market need “if those same companies can pass on fixed pipeline construction costs to existing capacity ratepayers while profitably selling any excess capacity to others,” Childs wrote.
The court officially vacated the certificate, noting that it was unclear whether FERC could fix the flaws in its order. Still, it said it was sending the matter back to the commission for “appropriate action.”
This is the second time in the past month that the DC Circuit took issue with FERC’s inadequate review and subsequent approval of a gas infrastructure project. In a recent decision, the same court, but a different panel of judges, told FERC to reevaluate its approval of Commonwealth LNG LLC’s proposed 9.5 million tonnes/year plant in Cameron Parish, La., saying FERC did not adequately assess the cumulative and direct environmental and health impacts of the project, as required by the National Environmental Policy Act and Natural Gas Act (OGJ Online, Jul 17, 2024). In that case, the court did not vacate the certificate.
A spokesperson for Williams Corp., Transco’s parent company, said the decision “will not delay” plans to put the full capacity into service. “We believe the court erred in vacating the certificate and we are taking the necessary legal and regulatory steps to address the court's concern and to ensure that this much-needed firm transportation capacity continues to be available to serve the needs of our customers without interruption,” the spokesperson told OGJ in an email.
A spokeswoman for FERC, which approved the project in January 2023, said the commission does not comment on court proceedings.
Most of the project’s capacity would feed LDCs in New Jersey, with the rest flowing to Delaware, Maryland, New York, and Pennsylvania. The project involves:
- a new 22.3-mile, 30-in. pipe lateral in Luzerne County, Pa.
- a new 13.8-mile, 42-in. pipe loop in Monroe County, Pa.
- a new electric motor-driven compressor facility in Gloucester County, NJ.
- modifications to existing compressor station 505 in Somerset County, NJ, and station 515 in Luzerne County.
